16 December 2003

EP adopted Takeover Directive

Parliament approved the Commission's new Takeover Directive but with a number of strategic amendments that make key provisions of the legislation optional, thereby backing the compromise package agreed informally last month in Council. Opposition to today's vote came from Members on the left, who felt the clauses on information and consultation of workers were inadequate.

Since the resulting legislation will allow for opt-outs, it is a pale shadow of the Commission's original proposal.

The main amendments concern the use of defensive measures, restrictions on votes and multiple voting rights, and especially the introduction of optional arrangements.

As part of the compromise any Member State is allowed to 'opt out' although individual companies in such a Member State would be able to 'opt in”. Furthermore, a company can be exempted from this rule if it has 'opted in' but has subsequently become the target of a hostile bid by a firm that does not itself observe the rule.

'Multiple voting rights' will be treated in the same way as restrictions on voting rights. However, opt-outs for Member States, as well as opt-ins for companies, will be available as in the case of defensive measures. Another amendment states that where such rights are being removed, 'equitable compensation' must be provided for any loss the holders incur. The precise terms of this compensation are to be decided by each Member State.

Commissioner Frits Bolkestein attacked the introduction of optional arrangements, saying this would send the wrong message to the markets. MEPs agreed that the directive as now amended represented little progress towards a genuine level playing field on takeovers in the EU.

adopted report

© European Parliament